Section 5: Working capital This section focuses on how the Group generates its operating cash flows. Careful management of working capital is vital to ensure that the Group can meet its trading and financing obligations within its ordinary operating cycle. On the following pages you will find disclosures around the Group’s cash position and how cash is generated from the Group’s trading activities, and disclosures around trade receivables and payables. Accounting policies Cash and cash equivalents comprise cash balances and call deposits. Cash equivalents are short term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Bank overdrafts that are repayable on demand and form an integral part of the Group’s cash management are included as a component of cash and cash equivalents for the purpose of the statement of cash flows. 5.1 Cash and cash equivalents The Group’s cash position at 31 December 2025 was £35.8 million (2024: £274.3 million). Of this balance, £nil million was cash equivalents money market deposits and £35.8 million was cash. The Group’s cash balances include £1.2 million (2024: £1.1 million) whose use at the balance sheet date is restricted by funding agreements to pay operating costs. The Group generates cash from its operating activities as follows: Note 2025 £m Profit for the year 97.6 Adjustments for: Depreciation and amortisation 3.3 6.9 Write-off of inventories and other fixed assets 12.0 Fair value of share-based payments 6.1 1.5 Change in value of investment property (owned and under development) 3.1 72.3 Change in value of investment property (leased) 3.1 12.9 Net finance costs 4.3 6.9 Interest payment for leased assets 7.6 Swap break and debt exit costs 3.1 - Mark to market changes in interest rate swaps 22.5 Loss/(profit) on disposal of investment property 1.3 Share of joint venture profit 3.4b (57.7) Trading with joint venture adjustment 3.4b 4.9 Tax charge/(credit) 2.5a 0.1 Cash flows from operating activities before changes in working capital 188.8 Decrease/(increase) in trade and other receivables 6.7 (Increase)/decrease in inventories (3.8) Increase/(decrease) in trade and other payables (20.8) Cash flows from operating activities 170.9 Tax (paid)/received 4.9 (4.4) Net cash flows from operating activities 166.5 NOTES TO THE FINANCIAL STATEMENTS continued 2024 £m 441.8 5.7 2.4 (186.7) 1.9 2.7 8.8 3.1 0.3 9.8 (115.9) 4.6 2.1 180.6 (12.0) (5.3) 48.2 211.5 4.9 216.4 THE UNITE GROUP PLC Annual Report and Accounts 2025 190 FINANCIAL STATEMENTS